Connecticut business leaders are reacting to the Republican bill introduced in Congress to fulfill their pledge to repeal and replace Obamacare (ACA — Affordable Care Act). While many of the details and potential effects of the GOP’s American Health Care Act have yet to be fully analyzed and understood, some businesspeople here have already come out in favor of the effort, while others suggest it needs tweaking and yet others say passing the bill and President Trump signing it into law would be a mistake.
“There’s not a lot of changes as far as pre-existing conditions, covering children up to age 26 on their parents’ policies and the guaranteed availability of insurance,” said Brian E. Rogers, the Stamford-based agency president at The SIG Insurance Agencies.
President Trump had promised a swift repeal and replacement of Obamacare during the campaign, while also complaining, “Nobody knew that health care could be so complicated.” Jennifer Herz, counsel at the Connecticut Business & Industry Association (CBIA), had some degree of empathy for Trump’s lament.
“Health care is complicated,” she said. “I am not mocking the president, but it is a difficult topic. There are a lot of stakeholders: providers play into it, insurance companies play into it, consumers play into it and employers play into it.”
While Herz noted the CBIA does not comment on pending federal legislation, she warned that any potential state legislative response in the event the AHCA becomes law needs to be a cohesive solution and not a skein of one-off bills. “Adapting a piecemeal approach is not the way to go,” she said. “Right now, we are not certain how all of the pieces will fit together.”
Also creating uncertainty was the fate of the ACA itself. Despite seven years of Republican promises to repeal the ACA, the AHCA does not include language to erase the 2010 law. Instead, it includes language amending various items in Obamacare.
Fran Pastore, president and CEO of the Stamford-based Women’s Business Development Council, worried that an updated version of the AHCA with a specific ACA repeal could have a deleterious impact on many smaller Connecticut businesses.
“I can tell you that most entrepreneurs with no access to any kind of health care depend on the ACA,” she said. “For low- and moderate-income entrepreneurs that don’t have large operations or large revenue, this is the only way for them to get insurance.”
Aaron Glick, director of business development and counsel for Chamber Insurance Trust, an Orange-based company that offers insurance services to Connecticut businesses and chambers of commerce, also questioned whether the move away from the ACA would be best for local companies.
“Since the proposed plan calls for tax credits, rather than subsidies based on age, middle-aged individuals will bear an increased financial burden,” he said. “Additionally, since the tax credit is not adjusted for geography, high-cost areas of the country like Connecticut, would hurt our fellow citizens, while low cost areas of the country would benefit.”
Glick added that the AHCA enables employers to increase the use of health savings accounts due to increases to the maximum allowed contributions into these products. But he also noted despite the removal of the employer mandates, business owners would “still be subject to the reporting requirements that have aggravated self-insured and level-funded plans.”
But Mickey Herbert, president and CEO of the Bridgeport Regional Business Council, did not share any concern on the possible disappearance of the ACA.
“Small businesses in Connecticut are struggling mightily with health care coverage right now, with many very small businesses offering no group health coverage at all,” said Herbert, a former CEO of ConnectiCare. “Many other small businesses offer coverage that can only be characterized as a ‘hollow promise’ for their employees because of the increasingly high deductibles and co-pays that have, unfortunately become the norm rather than the exception. And these policies have had soaring premiums for a while now.”
Herbert added that there was an imbalance in the ACA between quantity and quality of coverage. “We have fewer uninsured in our state than before the ACA, but we also often have far inferior coverage,” he said. “And the number of Medicaid enrollees in Connecticut have grown precipitously with the ACA, leaving the state with a potentially gaping hole in the state budget if the federal coverage reduces CT Medicaid from a 95 percent match for federal funding down to a 50 percent match as is being proposed in the American Health Care Act.”
One sector that could possibly enjoy increased business opportunities with the AHCA is the insurance broker profession. “It is supposedly broker-friendly,” The SIG Insurance Agencies’ Rogers said. “Now, the ACA is not necessarily broker-friendly — it is not paying the broker’s commission to enroll people in the exchanges. And if someone buys off an exchange, the commission is eliminated on that. And I don’t think the current scenario is helping at all — consumers are left in the dark to make decisions they don’t want to make.”
Rogers predicted that passage of the AHCA could inspire small businesses to band together to form buying cooperatives for acquiring and maintaining health insurance — a development that Rogers believed could earn brokers new clients and profits. Another insurance professional — Brian Lowell, employee benefits consultant at Fairfield-based ACBI Insurance — forecast AHCA-fueled opportunities for brokers to build their new leads by taking a proactive educational response in explaining the law to business owners, adding that the AHCA could also have compliance concerns related to the ACA’s employer mandate.
“Companies are paying for behind-the-scenes services to track and report that coverage,” he said. “Eliminating that will save companies a few thousand dollars a year and a lot of headaches.”
But Lowell warned that whether one supports the AHCA or prefers to maintain the ACA regimen, one thorny problem remains: neither solution specifically addresses what to do about the increased costs of health care. “It is more of a coverage issue,” he said. “I’m not going to suggest answers, but I know it is a political hot button and I don’t think that answering that question would win someone an election.”